Pfizer's Fair Value Gets a Booster

We are boosting our

Within Pfizer’s large product portfolio, several mixed product trends led to overall 4% year-over-year growth, with particularly strong sales in vaccines and cancer drugs offsetting declines from mature drugs. Notably, pneumococcal vaccine Prevnar 13 (up 44% and representing 13% of total sales) continues to outperform our expectations, and we believe the international launch in the adult patient population will support continued growth. Further, cancer drug Ibrance is generating robust growth that should continue over the next several years. The strong growing drugs are more than offsetting generic Celebrex and Zyvox competition, and we anticipate a slowing of generic headwinds in 2016.

On the pipeline front, while Pfizer’s pipeline focuses on several areas of increasing competition, the potential of these markets is large enough to support several new blockbusters. In particular, cardiovascular drug bococizumab, diabetes drug ertugliflozin, and immuno-oncology drug avelumab should develop into new blockbuster opportunities.

Turning to corporate restructuring, we expect Pfizer will continue to make major acquisitions and eventually break up into two entities. As Pfizer has completed the Hospira acquisition, we expect Pfizer to make another acquisition in the specialty pharmaceutical industry, where stock prices have fallen significantly and where Pfizer now has more potential to create value by leveraging its worldwide distribution.

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